Royal Oak's Motor City Gas Craft Whiskey Distillery Turns 1

ROYAL OAK, MI – At this time last year, Rich Lockwood’s dream to open Royal Oak’s first spirits distillery was running on fumes.

The 2015 St. Patrick’s Day opening of his nano-distillery, Motor City Gas, wasn’t a planned launch, but one born of necessity.

“My wife told me that if we didn’t open the door — we’re totally family owned and self-operated — we would literally run out of money,” Lockwood told Patch.

Opening a distillery isn't easy, he said, explaining “it took two years to get through all the red tape.”

So, with dire financial realities bearing down, Lockwood opened the whiskey-only distillery and tasting room to a few family members and friends, along with passersby who had seen activity that had been going on at the space at 325 E. Fourth St. — and to strong reviews that have morphed a year later into a 5-star Yelp rating, “which is pretty unique,” Lockwood said.

“I don’t even think we had ice,” Lockwood, 40, recalled. “We didn’t even have a cash register. We just threw money in a drawer. We didn't have money to advertise, and it was all word of mouth.”

But Royal Oak’s whiskey palate had been whetted, and it’s all been, well, a gas since for Lockwood and his wife, Tonya, and their employees — two who work full-time, and another part-time worker.

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Michigan ranks third nationally in the number of craft distilleries. With nearly 40 statewide — almost as many as existed nationwide 10 years ago — and more in the works, the fast growing industry could contribute upwards of $400 million to the state’s economy, according to the Michigan Craft Distillers Association.

Nationally, there are now about 775 craft distilleries, and Motor City Gas is in an elite class among them.

“... I would venture that only 50 make any money,” Tom Mooney, president of the American Craft Spirits Association, told Fortune magazine. “The typical craft distillery has revenues under $1 million.”

Think Small

Lockwood didn’t disclose his revenues, but said he’s making payroll and keeping the lights on. He’s not trying to be the next Jack Daniels or Jim Beam or — on the craft side of the whiskey business — A-list spirits like Templeton Rye, George Dickel Rye and about 50 other whiskeys that bill themselves as small-batch, but are more than likely distilled at the same former Seagram's distillery in Indiana.

Everything that is distilled is sold on site, half of it by the bottle and the other half in the tasting room.

“The smaller the barrel, the faster it ages,” Lockwood said, explaining the rationale for the small production scale. “We age in different size barrels so it can be released at different times.”

The smallest barrels age in six months to a year. Larger barrels age for longer. As a fledgling distillery, Motor City Gas’ oldest whiskey is about two years old.

“I do want to put some away for a very long time for a 12-year-old bourbon that I hope will collect a lot of dust,” Lockwood said. “For a distillery like ours, it costs a lot of money, and we don’t have a lot of capacity.”

The small barrels also give Motor City Gas customers an always-changing menu of whiskeys, from the Royal Oaked Rye, the distillery’s debut whiskey, to “Hot Mess,” a nine-grain malt whiskey that will be released on St. Patrick’s Day, and more than a half dozen in between.

If you were hoping to toast St. Paddy with an Irish whiskey, you’re out of luck. The distillery’s debut Irish whiskey is still aging and won’t be available until this time next year.

Why Whiskey?

Besides the scale, Motor City Gas differs from other distilleries in some important ways: It’s one of Michigan’s only family owned and operated nano-distilleries. To the extent possible, products are locally sourced and grown. The business is a full process, grain-to-glass distillery.

Another important distinction: Motor City Gas is one of only a handful of distilleries in the country that make only whiskey.

“Most start with vodka, because it doesn’t have to be aged and can be served quickly, then get into spirits,” Lockwood said.

He’s is a whiskey hobbyist, and as such, “I didn’t want to make anything wasn’t I passionate about,” he said.

“I’ve made beer, wine and different spirits from vodka to gin,” he explained, “but there’s something about whiskey and how American it is. I just think whiskey is as American as George Washington, who was a distiller; and cowboys and the Wild West and Prohibition. I can’t think of a spirit that embodies the American culture more.”

“Beer Guys” Cleared the Path

Opening on the fly a year ago was “scary,” Lockwood said.

“It’s a brand new industry, without a lot of other businesses to benchmark from,” he said. “Most distilleries have investors and a lot of money to pay consultants. We are a small mom-and-pop, only selling out our front door.”

Lockwood is optimistic the craft distillery business will follow the same growth curve as craft beer industry in Michigan, one of the nation’s top producers with more than 200 mircro- and nono-breweries operating in the state and about three dozen more in the planning stages, according to the Michigan Brewers Guild.

“The beer guys paved the way,” he said.”They were out in front updating some of the outdated laws that go back to Prohibition that make it easier to get into the business. In some ways, because of that, distilleries will grow faster than the craft beer industry.”

If the pressure the the beer industry’s pint-sized brewers is putting on big beer companies is any indication, large-scale distillers may well want to be prepared for a similar upheaval.

“In my opinion, it’s like craft beer,” Lockwood said. “It’s made in smaller batches, more care is put into the selection of materials and hand-crafting results in a more interesting product, a more flavorful product.

“The true craft people in the industry are innovating and creating more unique products that you’re not going to find on the shelves.”

If You Go

Where: 325 E. Fourth St., Royal Oak | Hours: noon-10 p.m., Tuesday through Friday; 2-10 p.m., Saturdays and Mondays; closed Sundays | More Information: motorcitygas.com